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Mainland 'rat trader' handed to police

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The mainland's securities regulator yesterday for the first time referred a criminal case of insider trading to local police, a wake-up call to an industry widely regarded as being rife with fraud.

Han Gang, a former fund manager with Great Wall Fund Management, was handed over to the police at an undisclosed jurisdiction for criminal investigation after he allegedly conducted inside trades.

The China Securities Regulatory Commission said Han's behaviour was serious enough that it decided to take action against the fund manager, who could face up to 10 years in prison if convicted.

The CSRC began a high-profile campaign to crack down on insider trading in the second half of last year, uncovering inside trading deals involving three fund managers, including Han, in September. It took nearly a year for the regulator to complete its investigation.

'The move against Han is a clear signal that more bad boys will receive the same treatment in future,' said Gong Zhenhua, a partner with Ronghe Law Firm.

'It is believed that he will be convicted, since the regulator wouldn't process the case unless it had collected solid evidence.'

The CSRC did not disclose details of Han's case. However, it did release information on 'rat trader' deals involving the other two fund managers - Liu Hai of Great Wall Fund Management and Tu Qiang with Invesco Great Wall Fund Management.

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